Paramount Global’s Office of the CEO is postponing an employee town hall that was set for Wednesday to June 25 as controlling shareholder Shari Redstone reviews a takeover offer from David Ellison’s Skydance Media.
“Given the ongoing speculation regarding potential M&A, we want to be able to speak to you with as much candor and transparency as possible,” co-CEOs Brian Robbins, George Cheeks and Chris McCarthy wrote in a memo to employees on Tuesday. “By moving the date, our hope is to do just that.”
The decision comes after the trio unveiled their long-term strategic plan for the company on Tuesday at its annual shareholder meeting, which includes streaming partnerships, $500 million in cost cuts and possible asset sales.
“Our plan looks forward by building back the best of Paramount, delivering higher revenue with lower costs, which translates to higher earnings and better returns,” Robbins said at the meeting. “We will be thoughtful in how we deploy capital, with our world class content always being the first priority. That’s the way we can maximize shareholder value and return Paramount to delivering consistent earnings growth.”
Under Skydance’s two-step plan, the company would acquire Redstone’s holding company National Amusements, which controls 77% of Paramount’s voting stock. The second step would then see Skydance merge with Paramount to create a combined company.
Redstone could also decide to pursue a deal with Sony Pictures Entertainment and Apollo Global Management, who submitted a joint, non-binding $26 billion all-cash offer for Paramount, or she could decide to have Paramount go it alone under the Office of the CEO’s strategy.
“We recognize that this is not a traditional management structure,” Redstone acknowledged during the annual meeting. “We are confident that it will enable them to move quickly to implement best practices throughout the company and to drive improved performance.”
Paramount, which has a market capitalization of $8.5 billion, has seen its stock price fall 21% in the past six months, 15% year to date and 19% in the past year. Shares fell over 4% during Tuesday’s trading session. In March, Paramount’s credit rating was downgraded to junk status by S&P Global.
The Office of the CEO said it would provide more updates on its strategic long-term plan during Paramount’s second quarter earnings call in August.
